Political Wisdom: Exploring the BP-U.S. Relationship

As the effects from the month-long oil spill in the Gulf of Mexico come into sharper view, many see efforts by BP and the U.S. to mitigate the damage moving in slow motion. On Sunday, Interior Department Secretary Ken Salazar bluntly said the U.S. would “push BP out of the way” if it didn’t stop the leak and adequately clean up. But also on Sunday, Coast Guard Commandant Thad Allen said he trusts BP CEO Tony Hayward and that sealing the leak would be up to the company. White House spokesman Robert Gibbs delivered a similar message: “They own the well. They’re responsible for capping it.”

Today, Salazar, Secretary of Homeland Security Janet Napolitano and a bipartisan group of U.S. senators will visit Louisiana on an inspection tour of the spill response.

Mike Allen and Eamon Javers at Politico look at the relationship between BP and the federal government, noting that Commandant Allen “struggled to explain just what it is that his government team has been able to order BP to do at all in this crisis” and talked instead of a “partnership between the company and the government” – an approach that has drawn criticism from Democratic allies.

The messages reflect the White House’s politically treacherous dilemma: President Barack Obama wants to deflect blame for the Gulf gusher, yet has to work with BP to have any hope of containing the disaster.

More broadly, the crisis reflects this sobering reality for Obama: on the biggest domestic calamity of this presidency, the fates of Obama and BP are intertwined, and Obama is largely a spectator to the underwater drama over whether BP can cap the leak.

The sense of crisis has grown as oil has begun washing up on some of Louisiana’s coastal islands. And with prominent liberal voices like Democratic strategist James Carville and commentator Chris Matthews offering fresh criticism of Obama’s response Friday – Carville called it “lackadaisical” – the White House has moved quickly to do what it can.

They are part political theater and part essential investigation by Congress, said Larry Sabato, a political scientist at the University of Virginia.

“These are show trials, to a certain degree … but they do perform an educative function for the public,” he said.

The hearings also will provide a framework for later congressional moves to boost regulation of offshore drilling and revamp federal oversight of the industry. Beginning Tuesday, lawmakers will focus on legislative responses, including proposals to overhaul the agency that regulates offshore drilling and to raise the legal limit on what energy companies must pay in economic damages from spills.

That’s a shift from the initial House and Senate action, which focused squarely on the corporations involved in operating, outfitting or leasing the now-sunken rig.

TrueSlant’s Jeff McMahon says when it comes to the oil spill progressives aren’t informed about the law. Specifically, he takes issue with poet Mark Doty, who has declared he has given up supporting President Barack Obama, and he explains how the Oil Pollution Act is governing behavior.

What Doty doesn’t seem to know is that the Oil Pollution Act, signed into law by President George H.W. Bush in 1990, restricts government involvement in oil spills to a supervisory role. The law was designed to avoid the situation that followed the 1989 Exxon Valdez spill, in which the government was left to clean up a private company’s mess and then had to sue the company to recover costs.

The same act restricts the liability of oil companies to $75 million, although they remain fully responsible for completing the clean up. That’s why BP is required to clean up its own mess. As the White House pointed out in a blog post yesterday, they’re also the ones who have the equipment…

Doty, like untold thousands of progressives frustrated by the continuing disaster in the Gulf, interprets his own lack of knowledge as a lack of action by Obama. One could actually investigate the facts, but it’s easier to cling to them to justify participation in this wave of misplaced populist anger… Populist anger inspired and perpetuated by ignorance of the facts, remaining undeterred by the facts: it’s not terribly different from those who believe Barack Obama was born in Kenya and who continue to believe it even when shown his birth certificate.

Rebecca Mowbray of the Times-Picayune in New Orleans pulls out the long lens to examine the spill-spawned litigation – so far more than 100 cases in federal courts, many of them filed in New Orleans.

The 19th century maritime law that Transocean Ltd. cited in filing a lawsuit to limit its liability in the April 20 explosion of its Deepwater Horizon rig could also give the companies involved in the disaster an edge to move all the litigation surrounding the incident to Texas.

On May 13, Transocean filed a proceeding in Houston under an outmoded 1851 law known as the Limitation of Shipowner’s Liability Act to limit its legal exposure to $26.8 million, or the value of the sunken rig and whatever freight it was carrying. The limitation of liability act also allows a vessel owner to consolidate all litigation over a shipping accident to a venue of its choosing, and like a bankruptcy filing, halts all proceedings in other courts.

In maritime law, a rig is considered a vessel. Attorneys say it’s an uphill battle for vessel owners to successfully limit their liability in a such a proceeding, so the primary reason for filing may be to nudge the massive litigation that is expected over the rig explosion and oil leak to Houston. … as Transocean’s proceeding moves forward in Houston to determine whether the company is eligible limit its liability, all depositions and discovery of facts will take place within the context of that suit. As work on the Transocean case proceeds in Houston, it could preempt the work of the panel of federal judges or help make the case that Houston has already become the nucleus of the litigation.

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